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It's going to be all about topline growth from here because it looks like there is little in the way of cost cutting available. 

Despite the "less bad" spin:

  • Las Vegas Locals EBITDA margins suffered their worst decline of the year – dropping 290 bps YoY to just 17.9%.
    • For the 1st time in years, costs actually increased, up 0.1%
  • In Downtown, EBITDA margins declined 490 bps YoY to just 10.9%
    • Expense control was tight – only up 0.1% but again there’s no room left to cut
  • Midwest and South had relatively their best quarters
    • Margins only declined 1.2% YoY
    • However, costs only decreased 0.5%
    • 4Q has the first “easy” comp of the year


  • Table hold was only 12.1% vs. an average 14.2% over the last 6 quarters.  Low hold cost them $9MM in revenues and probably about $3MM of EBITDA.
  • Operating expenses decreased 1% YoY
  • BYD declined the option to buy the other half of Borgata  - smart move in our opinion given the higher than expected multiple.  We're not convinced the deal on the table will go through so BYD may get another crack at a lower multiple